Despite billions of dollars spent on lead-generation programs and branding campaigns, a significant portion of these expenditures are not driving channel performance or product sell-through, the CMO Council reports, citing its Channel Performance Outlook Study.
In some cases, marketing and sales activities may well be alienating the channel, reducing trust, confusing the customer and reducing overall productivity and effectiveness, it found.
The CMO Council also released a scorecard for how vendors drive business performance through some of the most critical avenues of customer engagement, purchasing and service worldwide.
Topping the list of channel complaints were lean lead rates, unqualified opportunities, and lackluster marketing campaigns that failed to connect with the customer.
Lack of cooperation between the channel and field marketing groups also surfaced as a significant issue, as well as the perennial problem of key account conflict with direct selling groups inside vendor organizations.
Among the key findings of the study:
- Less than 7% of resellers say vendors are their most valuable source of leads.
- Only 19% say vendor leads were highly actionable.
- A surprising 70% of resellers say vendor marketing campaigns are ineffective or only somewhat effective in driving their business.
- When it comes to partnering, a disappointing 46% say vendor field marketing reps never or infrequently team with them in cooperative selling.
- Nearly 80% of resellers say they experienced significant, or some, conflict or competition with vendor sales organizations.
- On a positive note, despite the economic downturn, a surprising 57% of the channel expects substantial increases in business.
“With as much as 80% of business leads languishing, lost or ineffectually handled, there is a big top-line revenue benefit for vendors seeking to increase yield, productivity and accountability throughout the channel,” said Donovan Neale-May, executive director of the CMO Council.
The findings of the Channel Performance Outlook study are in line with similar results of a Customer Affinity Index report released earlier in the year by the CMO Council, which reveals further vendor-channel disconnects.
In that poll, only 3% of channel partners indicated that their vendors are extremely well aligned around the end customer, and only 8% of vendor marketing respondents said they do an extremely good job of teaming with the channel to build stronger customer affinity.
About the study: Sponsored by BLUEROADS, the Channel Performance Outlook 2008 report includes insights from over 500 dealers, resellers, and distributors across six industry sectors: Information Technology, Physical Security and Surveillance, Telecommunications, Consumer Electronics, Office Products, and Professional Audio/Visual Equipment. The combined revenue for these business partners is expected to exceed $5 trillion by 2010 based on aggregated data from vertical channel publications.
